Company Car: buy new, lease new, buy used

[Shaun @ Tru6]

We're looking at getting a company car. Possibilities:

Scion xB, giant toaster on wheels

Honda Element, "I pinch"

Grand Cherokee (most likely used, 2002+)

The first two are just nice lightweight haulers that get good gas mileage. The Jeep I can tow with too, and since we've got a vintage racer theme running through the T's, may try to do something creative with the 69 in terms of events and corp. sponsorship.

But from a tax/business perspective, which would be better, the lease or buy outright?

[fastpat]

Originally posted by Shaun 84 Targa
We're looking at getting a company car. Possibilities:

Scion xB, giant toaster on wheels

Honda Element, "I pinch"

Grand Cherokee (most likely used, 2002+)

The first two are just nice lightweight haulers that get good gas mileage. The Jeep I can tow with too, and since we've got a vintage racer theme running through the T's, may try to do something creative with the 69 in terms of events and corp. sponsorship.

But from a tax/business perspective, which would be better, the lease or buy outright?

You need to know how much mileage you'd put on the car every year; there's a large penalty for exceeding the mileage limits each year; you can't drive a lot one year, then make it up the next. If you drive within the prescribed limits, use it only for business trips, and nothing else a lease might make sense.

For primarily personal use, with occaisional business use, purchase makes the most sense in my opinion. No mileage limits, and you still get the depreciation on the "business equipment" if things are done correctly.

[Dueller]

A buddy had a similar dilemma as an employee needing a work hauler. The Scion was just too small and tinny to use on the highway. We test drove one and while it may get great gas mileage the slightest cross wind would move it over a half lane at speed. Cute. But damned small. Bumpity bumpity ride. Not much payload.

He ended up getting the Element. Great little truckster, Honda quality, easy to clean (no carpeting...just hose it out), lottsa room for hauling stuff but suprisingly poor mileage (18-19 city/24-26 hiway). Somewhat of a rough ride. If you buy a used one be aware that they had massive odometer failures with these cars...even a recall. When this happened to my friend they offered to reprogram the odo with "estimated" miles or send it off to have the actual miles retrieved. I'd want some different/varied documentation if one showed unusually low miles. He ended up selling it for c.$13K w/67K on the clock (a 04 model well maintained).

I might go with the Grand cherokee depending on the duties.

I wouldn't get into a "fleece" if my life depended on it...too much chance for a big suprise $$$$ on the back end. I'd buy used and depreciate the hell oout of it....you'll likely be able to write off as much, if not more, by ownimg it. A little more work for your accountant, but worth it in my opion

[cantdrv55]

Honda Element and watch your mileage.

[Tobra]

buy it and depreciate it out. Speak to your accountant first, but that is probably the way to go, if you take care of your stuff

[Shaun @ Tru6]

thanks guys, looks like we're going to go with a newer Jeep and purchase outright. Seems like the best of all worlds if we go with the 6.